7 May 2013 — The national construction sector is at the lowest point in seven months as tough industry conditions continue.

The Australian Industry Group/Housing Industry Association Australian Performance of Construction Index for April saw a 3.8 point reduction to 35.2 (readings below 50 represent a contraction) – the 35th consecutive month of contraction.

Construction activity was down to 34.7 while employment dropped 9.4 points to 29.8, the weakest employment reading since the index began seven-and-a-half years ago.

“The decline in construction activity in April is a further setback to an industry already under intense pressure,” said Australian Industry Group director Peter Burn. “These pressures are particularly hard felt in the residential and commercial construction sub-sectors.”

Housing Industry Association chief economist Harley Dale used the data to call for a federal government response, saying Reserve Bank of Australia interest rate cuts – like today’s 25-point reduction – were not enough.

“This situation requires a policy focus from the Federal government, not just the RBA,” Mr Dale said. “We have two crucial sectors of the Australian economy – residential and commercial building – that continue to contract under the weight of weak demand, tight credit conditions and an excessive taxation and regulatory environment.”